Statement of Marybeth Peters
The Register of Copyrights
Subcommittee on Courts and Intellectual Property
Committee on the Judiciary
United States House of Representatives
105th Congress, 2nd Session
July 23, 1998
Copyright Office Operations, Accomplishments, and Challenges
Chairman and Members of the Subcommittee: The Copyright Office appreciates the
opportunity to testify at this Oversight Hearing. My statement reviews our operations,
major accomplishments and challenges.
Last year, 1997,
was an important year for the Copyright Office; it was the 100th anniversary of the
Copyright Office and of the position of Register of Copyrights. During these 100 years,
the role of the Office has been one of leadership in the establishment of U.S. copyright
policy and service to the nation.
Office's duties and responsibilities are many. First, it provides expert assistance to
Congress as well as the Administration on copyright matters. The Office works closely with
members of Congress and their staffs, providing policy and technical advice, and
legislative drafting and testimony on an ongoing basis. It prepares studies, analyses and
reports on timely and critical issues; acts as a technical advisor to the Executive Branch
in the international arena; and cooperates with international organizations in conferences
and educational programs.
Office is also an office of record, a place where claims to copyright are registered and
certificates of registration are issued, or if the legal and other formalities of the law
are not met, refused. Such refusals may be appealed and ultimately may be reviewed by a
court. It is also a place where documents relating to copyright may be recorded. These
include, assignments, licenses, security interests, wills and notices filed under the
Uruguay Round Agreements Act and the North American Free Trade Agreement. It creates a
public record of these actions, which, at least for actions taken since 1978, is available
With respect to
these records, the Copyright Office provides copies of them and certifies them when
requested. It reports on information found, e.g., whether or not a work is registered,
when a work was published and the name and address of the current owner of record. The
Copyright Office also administers a number of statutory licenses, including collecting and
distributing royalty fees, and oversees and participates in the Copyright Arbitration
Royalty Panel system.
The Office also
furnishes information about provisions of the copyright law and practices and procedures
of the Office and maintains a Public Office which is open Monday - Friday from 8:30 a.m.
until 5:00 p.m., eastern time. Finally, we administer the mandatory deposit provisions of
the law which provide for demand of two copies of the best edition of copyrighted works
published in the United States for the use of the Library of Congress in its collections
or exchange programs.
Timely action by
the Copyright Office, and complete, reliable and objective records of copyrights showing
their authorship, ownership and legal status are essential to copyright owners and the
public. Additionally, benefits are tied to registration; United States owners may not
initiate a copyright infringement suit without first registering with the Copyright Office
or without obtaining the Office's refusal to register. Certificates of registration and
certified copies of transfers of ownership are relied on by our courts, customs officials
and even foreign courts. Despite valiant efforts by the management and staff of the
Office, some of which are outlined below, the Office lost ground in providing essential
copyright services, and we have a significant arrearage with registration now taking
between six and eight months, instead of six to eight weeks.
In fiscal year
1997, the Office, with a staff of 496 full time employees, received approximately 630,000
claims, registering 569,226 which represented over 700,000 works, recording 16,548
documents with more than 250,000 titles, collecting $15,076,608 for our services and
obtaining over 850,000 copies of works worth over $25,000,000 for the collections of the
Library of Congress. Additionally, we handled 421,150 requests for information, and we
accepted numerous cable, satellite, and DART claims. In calendar year 1997, the Licensing
Division collected over $196 million in royalty fees and distributed over $175 million in
royalties collected in earlier years.
registration side, the statistics are somewhat misleading. In the past several years the
Office has moved to expand its group registrations--that is, the use of a single
application to cover multiple works at a reduced fee. Group registration is possible for:
unpublished works that are authored and owned by the same individuals; serials, daily
newspapers; newsletters; databases, and works restored under the Uruguay Rounds Agreement
Act. Group registrations were established to encourage publishers of works that the
Library needs for its collections to register their works immediately after publication
and in certain cases to ease the burden on authors. The result is that the number of
registrations decreased but the work did not decrease proportionately because in most
cases each individual work in the group must be examined.
Our focus this
year is on:
Improving our technical assistance to Congress and the
Developing the Copyright Office Electronic Registration,
Recordation and Deposit System, CORDS;
Improving our service by providing more timely registration
of claims and recordation of documents as well as making more information
available to the public electronically;
Establishing a new schedule of statutory fees;
Overseeing the compulsory license system; and
Acquiring and assuring the security of materials received
through mandatory deposit.
I. Improving Our Technical Assistance to Congress and the Administration
A. Assistance to Congress
States Copyright Office continued to provide its expertise in support of the legislative
work of Members of Congress and their staff by providing policy and technical advice,
testifying on bills, assisting in the drafting of statutory language and legislative
history, conducting negotiations, and preparing studies and background memoranda.
1. Studies of legislative and policy issues.
continues to study and report on significant national and international copyright
questions. During the 105th Congress, it completed three studies. It also commissioned two
reports, one on the long-term future directions of digital technology and another on CARP
Review of the copyright licensing regime's retransmission of broadcast signals. At
the request of Senator Hatch, the Copyright Office conducted a review of the copyright
licensing regimes governing the retransmission of over-the-air broadcast signals by cable
systems, satellite carriers, and other multichannel video providers.
considered the advisability of extending the satellite compulsory license, the disputes
surrounding the implementation of that compulsory license, and the "unserved
household" restriction for the retransmission of network television stations. The
report also considered the possibility of harmonizing the cable and satellite compulsory
licenses, and whether to extend those licenses to new technologies and allow
retransmission of broadcast signals over the Internet or by telephone companies.
The final report
was delivered to Senator Hatch on August 1, 1997. For the convenience of the public, the
Office posted the full report on its website at www.loc.gov/copyright.
Report on the legal protection for databases. Also at the request of Senator Hatch,
the Office held numerous meetings and prepared a report on legal protection for databases.
The report gave an overview of the past and present domestic and international legal
framework for database protection. It identified the issues to be addressed in considering
new statutory protection for databases in the United States, and described the views and
concerns of the interested communities. This report was delivered to Senator Hatch on
August 18, 1997, and is also available on the Office's website.
Funding the arts through a copyright term extension fee. Senators Kennedy, Dodd,
Simpson, Leahy, and Brown requested that the Copyright Office and the Congressional
Research Service conduct a joint study on the costs to the general public of extending the
copyright term. The study considers the financial implications of the copyright term
extension proposed in current legislation, and the costs and benefits of imposing an
additional filing fee on works made for hire during the extended term to create federal
funds for the public arts and humanities communities. The study considers whether such an
assessment on works for hire would violate international treaty obligations as well as
whether it would represent sound public policy. The Office submitted its part of the
report to Senators Dodd, Kennedy, and Leahy in February of 1998.
Project Looking Forward. In order to assist us in our role as an advisor to
Congress, the Copyright Office commissioned a study by a leading expert on Internet law,
Professor I. Trotter Hardy, on the long-term future directions of digital technology and
the issues likely to be raised for copyright law. His final report, entitled "Project
Looking Forward: Sketching the Future of Copyright in a Networked World," was
released by the Office just this week and is also available on our Web site.
2. Legislative assistance.
reform. The Office's cable and satellite report recommended legislation that would
harmonize the satellite and cable compulsory licenses and adopt other reforms in those
licenses. The Copyright Compulsory License Improvement Act, H.R. 3210, which you
introduced, Mr. Chairman, incorporates some of those recommendations.
implementation. The Copyright Office drafted the technical provisions of the proposed
language to implement the two 1996 World Intellectual Property Organization treaties that
was sent to Congress by the Administration in July 1997. After H.R. 2281, the WIPO
Copyright Treaties Implementation Act, was introduced, the Register of Copyrights
testified at the Subcommittee's hearing on the bill. The Office also assisted members and
staff of the Subcommittee and full Judiciary Committee in developing various amendments.
One of the amendments added to the bill was a provision permitting the maintenance and
servicing of computers, which had been negotiated under the auspices of the Copyright
Office in the 104th Congress pursuant to the request of then-Chairman Moorhead.
service provider liability. The Copyright Office assisted in ongoing discussions of
the issue of on-line service provider liability for infringements on the Internet,
including providing analyses of existing law and drafting statutory language to implement
various different approaches to the issue. The Register of Copyrights presented testimony
to the Subcommittee on H.R. 2180, the On-Line Copyright Liability Limitation Act.
Database protection. After having issued our 1997 Report on Legal Protection
for Databases, the Copyright Office worked with the Subcommittee extensively
on the development of legislation that responded to the issues and concerns
identified in the Report. The Register testified on H.R. 2652, the Collections
of Information Antipiracy Act, which passed the House in amended form on May
extension. The Copyright Office provided ongoing technical assistance and advice on
issues involved in the extension of the term of copyright protection. At the request of
Chairman Coble, the Office also presided over negotiations among the motion picture
industry and the actors', screenwriters' and directors' union to develop a provision
guaranteeing the continuing payment of residuals, by imposing on transferees of rights in
motion pictures certain existing obligations under collective bargaining agreements. This
provision was added to H.R. 2589, which also included an exemption for libraries that was
recommended by the Register of Copyrights as the outgrowth of negotiations in the 104th
Congress among library and copyright owner groups. H.R. 2589 passed the House in amended
form on March 25, 1998.
corrections. The Copyright Office worked closely with the Subcommittee on achieving
passage of legislation reversing a court decision that jeopardized copyrights in pre-1978
recorded musical works, and legislation clarifying and correcting technical errors and
ambiguities in various provisions of the Copyright Act, including the restoration
provisions of the Uruguay Round Implementation Act. This legislation was enacted into law
on November 13, 1997, as Public Law No. 105-80.
legislation. The Register of Copyrights testified at Subcommittee hearings on H.R.
789, the Fairness in Music Licensing Act; H.R. 2265, the No Electronic Theft (NET) Act
(enacted as Public Law No. 105-147 on December 16, 1997); and H.R. 2696, the Vessel Hull
Design Protection Act.
provided to Congressional staff written analyses of numerous issues addressed in bills
introduced in Congress.
The Office held
for Members of Congress and their staff the second of an annual program of educational
seminars, "Copyright Principles and the Legislative Agenda." The seminars
focused on important issues of copyright law and policy relevant to the legislative
business of Congress, including basic principles of copyright law and issues raised by
B. International Activities
1. Technical assistance to the Executive Branch.
Office continued to work closely with agencies in the Executive Branch on international
copyright issues. The Register of Copyrights and various attorneys from the Office of
Policy and International Affairs participated as members of the U.S. delegations at WIPO
meetings on database protection, audiovisual performers' rights, design protection and
technical cooperation; at World Trade Organization (WTO) meetings and consultations with
respect to implementation of the Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPs); and in negotiations over a Multilateral Agreement on Investment
at the Organization for Economic Cooperation and Development (OECD). In addition, the
Copyright Office provided technical assistance to the U.S. Trade Representative and the
State Department on application of U.S. trade laws and policies, including regional and
bilateral negotiations, WTO accessions, and reviews of other countries' laws. Finally,
Office staff participated in USIA programs in various countries dealing with copyright
2. Cooperation with international organizations.
participated in conferences and seminars sponsored by the World Intellectual Property
Organization, the European Commission's Imprimatur project, the International Bar
Association, the International Telecommunications Society, and the International
Federation of Library Associations.
International Copyright Institute of the Copyright Office hosted a three-week study tour
for a delegation from the National Copyright Administration of China. The Office is
preparing to co-sponsor with the World Intellectual Property Organization a week-long
global program on copyright and neighboring rights in December.
II. Development of the Copyright Office's Electronic Registration, Recordation
and Deposit System (CORDS)
A. Initiating Development
CORDS is an
innovative system that will result in a national centralized system that allows electronic
filing over the Internet of applications, deposits, and fees for copyright registration as
well as documents of transfers of ownership including licensing information, such as terms
and conditions of use. A feature of the system will be the storage and retrieval of
copyrighted works from secure repositories for electronic dissemination in accordance with
terms and conditions established by copyright owners.
The system is
the result of the cooperation of the Copyright Office, the Library of Congress and the
Corporation for National Research Initiatives (CNRI). Funding has come from the Library of
Congress and the Advanced Research Projects Agency of the Department of Defense.
CORDS will help
the Office improve productivity by streamlining operations and will provide better service
to the public. All Office functions will be performed online: the acknowledgement of
receipt, examination of the claim, any correspondence concerning the claim or the deposit
copy, production of the certificate, and cataloging. When a work is registered it will be
placed in the Office's digital repository, which will provide a means of ensuring
authenticity and integrity of the work.
The first claim
came from a graduate student at Carnegie Mellon University on February 27, 1996. Since
then Stanford University, MIT Press Journals Division, and the University of Phoenix
became test partners, further proving the concept of the system. The system's capabilities
were expanded to cover additional classes of works, multiple hardware platforms and
operating environments, as well as multiple Internet browsers. Planning is being finalized
for accepting electronic applications with traditional deposits. A long-range business
plan analyzing the costs and benefits has been completed. Recently, a batch mode interface
was created to support publishers who submit large numbers of claims, and an extensive
outreach effort to gain new partners for the full or the partial system is underway.
D. Future Developments
Office and its expert consultants will continue to build on and enhance the basic
production system, incorporating changes as well as the latest advances in technology.
and Cataloging Divisions are prepared to begin receiving and processing submissions from
UMI, one of the Office's largest remitters, which will be registering approximately 20,000
dissertations and theses each year by means of our electronic filing system. Because of
the consistent nature of these claims, the processing will be done by technicians rather
than examiners. Technician processing frees examiners to handle more complex claims.
III. Improving Our Service by Providing More Timely Registration of Claims
and Recordation of Documents As Well As Making More Information Available to
the Public Electronically
A. Improving Service for Copyright Owners and Users
1. Implement streamlining initiatives.
a. Restructuring process. The Office
has been discussing the restructuring of processing of claims which would reduce
the movement of materials by combining several traditional operations and have
them performed in one area. This is referred to within the Office as a product
line. A product line operation essentially exists for the registration of motion
pictures and television programs selected the Library for its collections.
Work is being
done to expand these efforts to include serials and periodicals. The processing of serials
is quicker than that of most other categories; serials almost never present a
copyrightability problem, since the author and claimant are generally the same--usually
the publisher of the serial.
Office is currently structured around the distinct functions of processing registrations,
e.g., incoming mail, fiscal control, examining, certificate production, outgoing mail, and
cataloging. Thus, our efforts at streamlining and combining operations will require an
extensive analysis and planning effort for which we are seeking additional funding
Implement Pitney-Bowes Ergonomic Solutions' Recommendations. The operation under
which staff processes all incoming submissions to the Copyright Office for registrations
and other services has changed very little over the past twenty years. This system is
labor intensive with 56 separate steps. With over one million items coming in to the
Office to be processed each year, this once effective method is no longer efficient.
Ergonomic Solutions evaluated the incoming and outgoing Mail Units. This evaluation
produced recommendations for better utilization of available space and proposed
enhancements that would result in more timely handling of submissions and a more accurate
audit trail for all items received. While some of the recommendations were
cost-prohibitive, they served as a springboard to other, more affordable options that
should reap substantially comparable results.
Over the next
few years, the Office expects to implement a number of these recommendations to reduce the
initial processing time of submissions and to establish a more timely online
tracking/audit record for registration and all others services. The changes will result in
improved service to authors, the copyright industries, the public and to the Library.
B. Improving Public Service
The Office has
implemented and is continuing to implement a number of improvements to enhance public
service including making more information available electronically. These improvements
move the Office forward to a future that will permit instant access to its records and
informational material and reduce the necessity for distributing paper copies.
The Office has
developed NewsNet, an electronic publication, distributed via the Internet. NewsNet
issues periodic e-mail messages to alert subscribers to hearings, deadlines for comments,
new and proposed regulations, new publications and other copyright-related subjects of
interest. Since November of 1997 when the first issue was distributed, the number of
subscribers to NewsNet has increased to over 2,000. Issues are sent out as
frequently as needed to provide information to the public in a timely manner.
The Office has increased the number of materials available
on its website. The website permits remote access to post-1977 Copyright Office
records, including records of copyright registrations and documents relating
to copyright. Last year the Copyright Office website was accessed over 1.3 million
times, and that number will increase each year. The information currently available
on the website includes: Frequently Asked Questions; HTML version of the copyright
law; revised chapters of the Compendium of Copyright Office Practices; all copyright
application forms; new and revised Copyright Office regulations; Copyright Office
studies; Copyright Office informational circulars; and WIPO documents and treaties.
Information Office now accepts inquiries pertaining to Copyright Office procedures and
practices, copyright law, and other inquiries from the public via e-mail. Last year the
Office responded to over 5,000 e-mail inquiries. The Examining Division is also using
e-mail to get needed information about claims from applicants.
4. Fax on demand
The Office has a
FAX on demand system which provides via fax transmission copyright informational circulars
and public announcements seven days a week, 24 hours a day. The system sends out over
5,000 documents each year.
5. Electronic Freedom of Information Act Amendments.
The Office amended its regulations regarding the Freedom of
Information Act (FOIA) to bring it into compliance with the Electronic Freedom
of Information Act Amendments Act of 1996 (EFOIA). EFOIA brings the law into
the electronic/digital age by requiring agencies to provide electronic access
to covered agency records. As a result, where practicable, Copyright Office
records that affect members of the public, as well as an index of such records,
are now available to the public in electronic format.
6. Exploring use of credit cards.
On January 1,
1996, the Copyright Office began a trial acceptance of credit cards for use in payment of
a limited category of services -- registration of claims and recordation of Notices of
Intent to Enforce (NIE's) copyrights restored under terms of the Uruguay Round Agreements
Act (URAA). Between January 1, 1996, and May 12, 1998, a total of 123,377 registration
claims and NIE's were received. Credit cards were used in payment of 1,390 submissions;
credit card payments totalled $46,354, which accounted for 12.16 percent of all income
received for these submissions.
detailing the two-year pilot program has identified problems to be solved before the use
of credit cards can be expanded. Additionally, a cost/benefit analysis must be prepared.
B. Ensuring Copyright Office Systems are Ready for 2000 and Beyond
The Office is
working hard to ensure that all of its automated systems are fully operational in the year
existing workload tracking system is being redeveloped to improve service and reduce
maintenance costs. The new system will be implemented by January 1999 and will be fully
capable of handling all dates.
cataloging system, has already had changes applied that will make it year 2000 compliant.
CORDS, our new electronic registration system, is already year 2000 compliant. The
Copyright Imaging System which is used to prepare certificates and reproduce recorded
documents is undergoing analysis to determine what changes are needed to make it
By June 1999,
all workstations in the Copyright Office will be upgraded to be year 2000 compliant. More
than 62 percent of this work is already completed. The Office also has 12 internal
systems, eight of which are already year 2000 compliant, and the remaining four will be
upgraded with new releases purchased in fiscal years 1998 and 1999.
C. Existing Challenges—Operational Arrearages
continues to experience serious processing arrearages, particularly affecting the
operation of the Examining Division. Some of these arrearages are due to staff shortages;
others stem from increased responsibilities or increasingly complex duties.
1. Increasingly complex claims
Some works such
as Internet content/websites, works fixed in digital formats and multi-media works have
made the examining process more demanding and complex. The substantive problems are more
difficult, but also it takes more time to handle the physical deposit copies, such as
2. Restoration of copyright in certain works: Uruguay Round Agreements Act.
The GATT Uruguay
Round Agreements Act was signed by the President on
1994; implementation of the Uruguay Round Agreement on Trade-Related Aspects of
Intellectual Property--known as the TRIPS agreement--resulted in three changes in the
copyright law; one of these changes had a major impact on the operations and workload of
the Copyright Office. This change restored copyright protection in a vast amount of
foreign works which were previously in the public domain in the United States for a
variety of reasons, e.g., publication without the notice of copyright formerly required by
our law, failure to renew the U.S. copyright, and the absence of copyright relations
between the United States and a foreign country.
protection is automatic, the act contained complicated provisions covering a prior user of
a restored work, defined as a "reliance party," who is insulated from liability
for infringement in certain circumstances and for a certain period of time after
restoration. The ability of the owner of a restored copyright to enforce rights against
reliance parties turns on his filing a notice of intent to do so with the Copyright Office
or alternatively serving a notice directly on the reliance party. Notices filed with the
Copyright Office must be filed within two years of the date of restoration of the
copyright in the work. A notice may be served at any time on a particular reliance party
against whom the rights are to be enforced.
With respect to
notices of intent to enforce a restored copyright that are filed with the Copyright
Office, the Office is required to publish in the Federal Register
a list identifying the restored works for whom such notices have been filed with the names
of owners of the restored rights. Reliance parties are granted a one year grace period to
sell off existing stock of the restored work; this period begins on the date the
information is published in the Federal Register. Thus, timely submission of
the information to the Federal Register is critical.
The Office was
given a number of new responsibilities under the Uruguay Round Agreements Act covering
both registration of works whose copyright had been restored and recording of Notices of
Intent to Enforce (NIE's) copyright in the restored works. The major part of that work was
completed with the publication of the last major NIE list for works restored effective
January 1, 1996. The Office will continue to register eligible works, and record notices
of works by authors of those countries still eligible to file NIE's.
A majority of
NIEs received under the URAA were for Spanish language films. There were also filings for
French, German, and Russian films. NIEs were filed for many of the most famous operas,
from "Aida" to "Turandot"; the major works of authors such as Virginia
Woolf, C.S. Lewis, T.S. Eliot, and Federico Garcia Lorca; and hundreds of works by
Picasso. Representative titles from various NIE lists are Stravinsky's "The Rite of
Spring," Jacques Cousteau's "The Silent World," and Alfred Hitchock's
"The Man Who Knew Too Much."
until the end of the two-year period to file, causing workflow problems. Our first list
published in the Federal Register in April, 1996 contained 2,793 titles
representing 1,259 NIEs. By contrast, the last NIE list published in April, 1998 contained
14,000 titles representing 11,848 NIES, and ran nearly 80 pages in the Federal Register!
3. Final appeals of denials of registration.
On its own
initiative, the Copyright Office implemented a more labor intensive, but more equitable
appeal procedure. Under the new appeals procedures, the first appeal of denial of
registration is directed to the appropriate section head in the Examining Division. If a
second appeal follows, it is directed to a Board comprised of the Register of Copyrights,
the General Counsel, and the Chief of the Examining Division. In fiscal year 1997, the
Board of Appeals issued decisional letters responding to 31 final appeals. It reversed the
decisions regarding three works and upheld the decision to deny registration regarding 87
D. Office's Responses to These Challenges
1. Hiring new staff
Between 1993 and
1996, examiner staffing had fallen by 38%. In 1997 the Office hired 13 new examiners. This
hiring did not, however, return the Office to the staffing levels of 1993. In order to
return to previous levels of 64 fully-trained and independent examiners sufficient to
process the approximately 620,000(1) claims per year, which
has the been the level of receipts for the past six years, the Office must hire another
The 13 examiners
hired in 1997 are beginning to make a difference in production as they make progress in
learning the examining work and contribute to reduction of arrearages. Funding permitting,
the Office will hire an additional eight examiners in the next fiscal year.
2. Working overtime
The Office has
used overtime to encourage completion of outstanding tasks in critical processing areas
such as the Examining, Cataloging, and Receiving and Processing Divisions.
3. Hiring temporary staff
Because of the
long training time involved in preparing people to handle examiner duties, the Office has
not hired outside temporary staff to examine claims. For the past eight months, however,
it has invited all previous examiners--those still working in the Library of Congress and
those who have retired--to come back to work any number of hours they can.
4. End of microfilming and assumption of the imaging workload
1997, the Documents Section sent all documents recorded in the Office off-site for
microfilming. Now it is reproducing the documents by creating digital images in-house.
D. Simplification of Existing Procedures
Examining Division is simplifying certain of its procedures:
1. Some claims processed at lower level
earlier, technicians are handling the entire examining processing for certain categories
of claims which do not present problems of a type requiring analysis by examiners.
2. Use of short forms
Office developed a short version of three of its application forms to make submitting and
processing certain copyright claims easier. The information requested is minimal, and the
instructions are brief and to the point.
This short form
may be used by any living author who is the only author of his or her work and the sole
owner of the copyright in the work. If there is more than one author of the work or if a
business organization is the copyright claimant, the standard form must be used.
3. Project special remitter
This method of
handling the claims to registration originated a few years ago within the Performing Arts
section of Examining and has since been extended to the Literary and the Visual Arts
sections for applicants who frequently register. This represents a significant improvement
in processing because one examiner is assigned to handle all claims which are received
from a specific applicant. The examiner becomes familiar with the situation for a given
applicant and also becomes familiar with the personnel of that applicant who normally
handle copyright registrations. Much of the formal written correspondence, which is more
expensive and time-consuming for the Office, has been replaced by phone or e-mail contact,
resulting in more efficient handling of both routine and more complex claims, and in an
expedited issuance of the final certificate. Good public relations are built by using such
for a specific applicant; both staff and applicant appreciate the enhanced communication
which is possible when knowledge has developed on both ends of the registration
activity over a period of time.
IV. Establishing aNew Schedule of Statutory Fees
leadership, the technical corrections bill, H.R. 1861, became
law on November 13, 1997, and we are in the process of designing a new fee
structure based on costs while considering the objectives of the copyright system,
fairness and equity. Registration must be encouraged so that the value to the public of
the Office's database of information on copyrighted works is not diminished and so that
there is no substantial decrease in the number or quality of deposit copies that come in
automatically through the registration system and that are made available to the Library
Each year the
Library selects more than 500,000 works for its collections. Copyright deposits are the
Library's primary source for books, serials, and other print materials published in the
United States. Nearly all U.S. newspapers are received on microfilm via copyright deposit.
The Library's motion picture and sound recording collections are heavily dependent on
copyright. Moreover, more than 60,000 books, not selected for the collections but selected
for our exchange program, allow the Library to receive important foreign works without any
cost to the taxpayer. Any substantial decrease in registrations would undermine the
collections of the Library.
1997, anticipating enactment of the fee bill, the Copyright Office began the
process of determining the costs of registering claims, recording documents
and providing related services. It hired two consulting firms with expertise
in cost accounting and the new Federal Managerial Cost Accounting Standards
and established a Copyright Office Fee Analysis Task Group (FEATAG). FEATAG
submitted a report to the Register of Copyrights which made certain recommendations
on the fees.
The Office has
also contacted representatives of interested parties to invite them to discuss the
forthcoming fee increases and identify their members' concerns. A number met with the
Register; some others submitted comments.
In early August,
the Office will publish a Notice
of Proposed Rulemaking (NOPR) with one or more
possible fee schedules and formally seek public input through a hearing to be held on
October 1, and a comment period. After considering the studies, the operational and policy
issues and the input from the public, the Office will propose a schedule of statutory fees
to Congress early in 1999. Given the Congressional 120-day period, it seems unlikely that
the statutory fees could be increased before July, 1999.
V. Overseeing the Compulsory Licenses
A. Update on Compulsory License Proceeding
Office administers a number of statutory compulsory licenses, including the licenses for
retransmission of broadcast signals by cable systems and satellite carriers; public
performances of sound recordings by digital audio transmissions; making and distributing
phonorecords of musical compositions, including digital phonorecord delivery; public
performance of published and nondramatic musical works by jukeboxes; and public
broadcasting entities' use of nondramatic musical works and pictorial, graphic and
sculptural works. The Office also administers the statutory obligation on sales of digital
audio recording devices and technology (DART). In 1993, Congress broadened the
responsibilities of the Office in this area when it replaced the independent Copyright
Royalty Tribunal with a system of Copyright Arbitration Royalty Panels -- or CARPs --
whose decisions are reviewed by the Register and the Librarian of Congress.
With respect to
royalty distribution, the Librarian announced the final determinations of the distribution
in 1990, 1991, and 1992 cable royalty fees, and the distribution of the 1992, 1993, and
1994 DART royalty fees. Both decisions were appealed to the Court of Appeals for the
District of Columbia Circuit. Additionally, the Office initiated two distribution
proceedings. The first involved a controversy between an individual claimant and the
performance rights organizations (ASCAP, BMI, Inc. and SESAC) over the distribution of the
1991 cable royalty fees in the Music Claimants category. This proceeding was decided on
the written pleadings, and like all the other decisions, it too has been appealed.
proceeding involving the distribution of the 1992, 1993, 1994, and 1995 satellite
royalties was scheduled for hearing, then suspended at the request of the parties pending
the outcome of the appeal of the first distribution proceeding. It has been rescheduled to
begin in November of this year.
The Office also
has a number of additional proceedings to schedule in order to distribute funds for past
years, including those to determine the distribution of the 1993, 1994, 1995, 1996, and
1997 cable royalties, the distribution of the 1996 and 1997 satellite royalties, and the
distribution of the 1995, 1996, and 1997 DART royalty funds.
Fiscal year 1997
was a particularly busy year because it covered the window years for the adjustment of, or
the setting of, the royalty rates for five compulsory licenses: 1) the cable compulsory
license, 17 U.S.C. 111; 2) the satellite compulsory license, 17 U.S.C. 119; 3) the
noncommercial broadcasting license, 17 U.S.C. 118; 4) the mechanical license, 17 U.S.C.
115; and 5) the sound recording performance rights license, 17 U.S.C. 114.
this is a new system, negotiations have been time consuming and not particularly fruitful.
Out of the five potential rate adjustment proceedings, only the parties concerned with
adjusting the cable royalty license fees have agreed to continue with the current rates
and not seek an adjustment. Attempts to negotiate an agreement among the parties
interested in setting rates and/or terms for the remaining four licenses have not been so
successful and have required or will require a hearing before a CARP.
Two of these
proceedings have been completed. The first set new rates for the satellite compulsory
license and the other established rates and terms that nonexempt subscription services
must pay for the public performance of sound recordings by means of a digital audio
transmission. The Librarian's final orders setting these rates and terms have been
appealed, and in the case of the satellite rate, also the subject of congressional
B. CARP Reform
Under the CARP
system, a CARP makes the initial decision on royalty rates and terms for the statutory
licenses. A CARP also makes the initial decision on how the royalties for a number of
these licenses shall be distributed among copyright owners. For each ratemaking or
distribution procedure, the Librarian of Congress impanels a new ad hoc CARP
whose members are selected from a list of potential arbitrators. After the CARP renders
its decision, the Register, with the assistance of the General Counsel and his staff,
reviews the decision and recommends to the Librarian whether to accept the decision of the
CARP or to reject it as arbitrary or contrary to law. If the Librarian rejects the CARP's
decision, he makes his own decision on the advice of the Register.
with this system over the past few years has persuaded us that it is burdensome, costly
and inefficient. Last fall, the Subcommittee asked us to make recommendations to reform or
replace the CARP system. After an exhaustive study of a number of alternatives, we
submitted a report on February 23 that addressed the deficiencies in the current system
and explored five options to improve or replace it. Those options included (1) improving
the existing system by changing some of the qualifications of CARP panelists, extending
statutory deadlines, providing for streamlined small claims procedures, and so on; (2)
replacing the CARPs with administrative law judges; (3) replacing the CARPs with non-ALJ
presiding judges; (4) replacing the panels with a Copyright Royalty Adjudication Board
within the Copyright Office; and (5) creating an independent regulatory agency.
the establishment of a Copyright Royalty Adjudication Board within the Copyright Office.
This recommendation was incorporated into H.R. 3210, the Copyright Compulsory License
Improvement Act, which has been approved by the Subcommittee. The Office supports this
legislation, and we are ready to continue to work with the Subcommittee and with copyright
owners and users affected by the compulsory licenses to explore how to improve the current
VI. Acquiring and Assuring the Security of Materials Received through Mandatory
As you know, the
Copyright Office is a division within the Library of Congress and works with the Library
in fulfilling the Library's mission of service to Congress and the American people.
A. Acquiring Deposits for the Library of Congress
Acquisition Division (CAD) staff works very closely with the service units of the Library
to acquire copyrighted materials that have not been registered or deposited. The mandatory
deposit requirement, 17 U.S.C. § 407, is seen as an invaluable avenue to acquire needed
and often expensive resources at a significant savings. CAD librarians communicate with
more than 100 Recommending Officers to identify those works to be acquired via the
mandatory deposit requirement. Additionally, CAD, working with the Congressional Research
Service and the Law Library developed a process which assures timely availability of high
1. Addressing security concerns
The Library of
Congress' mission statement recognizes collections security as a high priority, stressing
that the collections of the Library are for the benefit of future generations of scholars
as well as those using the vast Library resources today. Security tagging is a large and
integral component of collection security and has been identified in the 1997 Library of
Congress Security Plan as a minimum physical security standard. Anti-theft devices are
currently being placed in hardbound book materials received through the Copyright Office.
The project to apply these devices was begun in 1993 as a cooperative effort between the
Library Services, Collections Management Division and the Copyright Office to reduce
losses. Staff of the Collections Management Division applies the strips in the Receiving
and Processing Division, Materials Control Section. The project was recently expanded to
include softbound paperback books.
Units heads recently approved the Collection Security Oversight Committee (CSOC) to
conduct a computer disc (CD) and CD-ROM security project to test the effects of applying
anti theft devices to CD/CD ROM materials. If the project is successful, the Library will
expand the application of anti-theft devices to increase security for these high-risk
materials. Further research is necessary to determine whether anti-theft devices can be
applied to other non-print materials.
The Copyright Office appreciates the tremendous support it
has received from you and the Subcommittee especially in recognizing the Copyright
Office's unique role and in moving forward the legislation which produced the
new fee structure.
1. Because of the many new opportunities for group registration
offered, the number of works actually registered has grown exponentially.